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As a business coach, I often get asked about gross profit – what it actually means, how to calculate it, and why it matters. A client asked me about it just this week, so I thought it was worth breaking it down here for other tradie business owners. Gross profit is simply the money left over after subtracting the direct costs of a job – things like materials and site labour — from the total sales. For example, if a job is billed at $100 and the costs of materials and labour are $60, the gross profit is $40. That’s the amount that tells you how much money your business has earned from the job before overheads like rent, insurance, or admin costs are factored in. It’s also useful to look at gross profit on a monthly profit & loss statement. Let’s say sales for the month are $100K, and … Read more
In this video, I talk about how to qualify customers properly and why it can save you a huge amount of time and frustration. I share a real example where one of my clients wasted half a day on a prospect who was nowhere near ready to buy, and how better qualifying could have prevented that. The key is to ask better questions. I explain how to: Uncover the customer’s real problem Understand the impact it is having Clarify their time frame Find out if they have a budget in mind These questions quickly reveal the quality of the lead and how serious they are about moving forward. I also share some practical ways to raise the quality of your leads: using questionnaires to gather more detail, inviting prospects to your office or showroom so they buy into the process, and even offering paid site visits that show commitment and … Read more
Today, I want to talk about something that trips up a lot of trades businesses: closing quotes. If you’ve ever found yourself frustrated when a customer says, “We need to think about it” or “I need to check with my partner,” you’re not alone. The truth is, you’ve probably been getting sales rejections for years without even realising how many opportunities you’re missing. The good news? When you put a strong system in place for handling objections, your conversion rate can jump by 20–30%. That’s a huge win for your bottom line. Common Objections (and Why They Happen) Let’s break down some of the most common objections I see in trades businesses — and why they matter. “We’ll think about it” You’ve put hours into quoting, and now they want time to think. But why aren’t they ready to say yes? If your office team doesn’t know how to … Read more
Should Trades Businesses Charge Call-Out Fees? Picture this scenario: you run a trades business, and the debate about whether to charge customers a call-out fee is a constant thorn in your side. It’s a predicament that countless tradespeople face, and the truth is, not many customers relish the idea of a call-out fee. So, where does that leave us? Let’s delve into this contentious topic and shed some light on the matter. For instance, imagine you’re at the helm of a trades business that tackles a handful of small projects each day. Say your charge-out rate per hour stands at $100—an amount determined by meticulous calculations or industry standards. This rate is meant to cover various overheads, including holidays, sick leave, superannuation, and other costs for your team. Now, here’s the crux of the issue: how much do you charge during those hours that your team isn’t directly on-site? Let’s … Read more
How Much Should Your Tradie Business Charge? The age-old question of determining the ideal pricing strategy is a conundrum that frequently perplexes tradie business owners. As a complex and multifaceted issue, there’s no one-size-fits-all answer. While I can’t cover all the nuances in a single blog, I can shed light on the key considerations that often occupy the minds of tradie entrepreneurs. The Balancing Act: Customer Loyalty vs. Profitability For many tradies, the dilemma revolves around striking a balance between retaining long-term customers and ensuring profitability. The value of a loyal, longstanding client cannot be overstated, and the prospect of alienating them with sudden price hikes is a valid concern. Crafting sustainable relationships while covering costs and generating profit remains a top priority for tradie business owners. They’re acutely aware of the investments they’ve made in equipment, aiming for long-term sustainability and profitability. Starting with the Fundamentals: Understanding Costs One … Read more
Strategies to Boost Quote Acceptance Rates in Your Trades Business Picture this: you’ve meticulously prepared a quote for a potential client, factoring in every detail to provide a comprehensive estimate. You send it off, waiting eagerly for their response. But more often than not, that response might be an objection. These objections can become stumbling blocks, hindering the acceptance of your quotes. Yet, fear not, for there’s a way to navigate these objections and significantly enhance your acceptance rates. Understanding the Obstacle In the realm of trades businesses, objections to quotes are a common hurdle that can leave business owners perplexed. Handling objections effectively is a skill that can dramatically influence your success. Many business owners, however, find themselves uncertain about how to address objections, which often leads to hesitancy in following up with potential clients. The truth is, tackling objections head-on is a game-changer. Even if you address objections … Read more
Mastering the Art of Following Up on Quotes: A Comprehensive Guide Discussing the topic of following up on quotes might not ignite excitement for everyone, but let’s face it, this aspect of business is often the key to success. How you follow up on quotes reflects not only your dedication but also the integrity of your promises made even before the quote was given. The Neglected Follow-Up: A Common Misstep The frustration around this topic is undeniable, as many tradespeople admit to the occasional lapse in follow-up efforts. However, any level of follow-up is a step in the right direction. At the very least, remember to touch base with potential clients – a simple act that sets you apart. The timing of your follow-up is essential. The consensus among businesses is to wait between three and seven days before reaching out after sending a quote. While larger projects might … Read more
Understanding Cost of Sales: A Valuable Tool for Tradie Business Owners In the world of business, knowing your numbers is crucial for making informed decisions and ensuring profitability. One essential aspect of financial analysis is the “Cost of Sales,” which plays a significant role in helping tradie business owners comprehend their financial performance and make strategic choices. Let’s explore what Cost of Sales is, its purpose, and how it can aid tradie business owners. Cost of Sales, Explained: The Cost of Sales represents the direct expenses incurred to produce the goods or services sold by a business. For tradie businesses, these costs typically include materials, wages, subcontractors, equipment rentals, and permits related to completing specific projects or jobs. Essentially, it encompasses all the direct costs associated with providing the services or products that generate revenue. The Purpose of Cost of Sales: The primary purpose of Cost of Sales is to … Read more
SCROLL DOWN TO GET A FREE COPY OF MY SALES PROCESS THAT COULD IMPROVE YOUR QUOTING SUCCESS BY UP TO 30% – 5 Tips On Quoting That Will Get More Work For Your Trades Business Doing Enough Quotes? So the first one here, I’ve put it down as, do enough quotes. What I find is some business owners, they get too busy and they stop quoting, and then they sort of start to run out of work and find themselves in a position where they have to win the jobs that they’ve already quoted. They find themselves in this game of, “Well, I’ll take some price off to close it.” So all of a sudden their margin starts dropping. Having enough quotes in the pipeline and having them done consistently means that you can pick and choose jobs, and you don’t find yourself having to slash prices and adding extra … Read more
Today I’ve got a little topic that came up with one of my customers which is really common. It is getting paid on time. This business is in the construction industry and it’s the start of February and guess what, they haven’t been paid